Tanzania Attains Record High Mining Revenue despite Acacia Conundrum
Special Correspondent, London – A myriad of transformational efforts by President John Magufuli of Tanzania to revamp the mining sector in a bid to make his country benefit from the mineral wealth are now paying dividend.
The country introduced legal amendments, institutional reforms and initiated taskforces to renegotiate mining contracts with giants like Acacia Gold and Tanzanite One firms. The efforts, opposed by a section of mining investors, are now yielding results.
A statement posted on government website revealed that for the first time since independence the mining revenue have bypassing the annual revenues target of shilling 310 billion as collections by end of May stood at shilling 311.33bn/-. The country’s budget process ends in 30 days.
“Within the remaining days we can collect over shilling 30 billion more. This makes this years’ mining revenue the most high since independence,” said a mining official in the government of Tanzania.
“Thanks to President Magufuli for making astounding strides in the policies, law and regulation in the minerals sector. This will enable Tanzanians to benefit from their natural resources,” said a statement posted on the revenue results.
When President Magufuli came into power in 2015 annual mineral collections stood at shilling 210 billion equivalents to only 4 percent of the GDP. Last year revenues rose to a staggering shilling 301 billion. This years’ record could double the 2015 data and sector’s contribution rose to more than 5 percent contribution to GDP.
This comes amid tensions between the government of Tanzania and Acacia Mining, a giant gold mining firm under Barrick Corporation. The dispute led to missed production targets by Acacia for several quarters now and remains to reach its finality.
While the Acacia stalemate rages on, the government of Tanzania has scored yet another milestone by reaching consensus with Tanzanite mining firm, TanzaniteOne. The firm is said to have paid about USD 16m as part payments towards settling its tax dispute with the government.
The rising revenues thus come mainly from small as well as medium scale miners. Under President Magufuli’s resolute leadership, the government removed the burden of unnecessary levies to ease the operation of artisanal miners so that they could remain with a size-able disposable income resulting on many tax evaders are now listed to pay taxes.
The government also installed special mining markets all over the country to curb illegal and dark market trading of gold, diamond, Tanzanite and other gemstones.
